India promises to remove hurdles after Iran seeks commitment that building of the 500-km Chabahar rail link will be taken up expeditiously

A file photo of Chabahar port. The agreement to build the $1.6 bn rail link lapsed in April. Photo: AFP

New Delhi: Questioning the seriousness of India’s intent, Iran has sought a firm commitment from New Delhi that the construction of the $1.6 billion rail link from Chabahar port will be taken up expeditiously, two people aware of the development said.

India has promised to remove hurdles to fast track the project, which will connect the port on the southern coast of the Gulf nation to the eastern city of Zahedan on the border with Afghanistan.

The issue came up for discussion during the visit of minister for road transport and highways and shipping Nitin Gadkari to Iran for the swearing-in ceremony of Iranian President Hassan Rouhani, the two people said, requesting anonymity.

“The minister has ordered to take up the matter with IRCON (IRCON International Ltd, the state-run company to which the contact was given) on priority and sort out the matter,” an Indian government official, one of the two cited above said.

India plans to develop the Chabahar port, which would give it access to landlocked Afghanistan and energy-rich Central Asia through its Jawaharlal Nehru and Kandla ports on the west coast, circumventing Pakistan.

But the agreement to build the 500-km rail link lapsed in April.

“During deliberations, the Iranian government asked the Indian delegation if it was serious about building the railway link as no efforts seem to have come up,” said the second person, also an Indian government official.

In May 2016, India and Iran inked 12 agreements including one for India’s IRCON to build the 500-km railway line as part of a transit corridor to Afghanistan. The agreements were signed in presence of Prime Minister Narendra Modi during his visit to Iran.

“They complained that the agreement had lapsed and IRCON hasn’t informed if it has managed to arrange for the funds for the rail project. The Indian delegation sought time and assured the Iranian government about India’s commitment,” the second official cited above said.

India has already built a 218-km road link connecting Delaram with Zaranj in Afghanistan, which is adjacent to the border with Iran. The Chabahar port, located in Sistan-Baluchestan province on Iran’s south-eastern coast, will also promote India’s strategic interests in the Gulf and Strait of Hormuz.

Experts say procedural issues should be resolved fast by India to leverage the opportunity that Iran offers.

“There is a positive movement. The Indian government is very focussed on its intent to move forward on Chabahar port which is a strategic project and forms an integral part of the International North-South Transport Corridor (INSTC). We will have to sort out the procedural issues and sustain the momentum,” said Meena Singh Roy, a research fellow at New Delhi-based Institute for Defence Studies and Analyses (IDSA).

Chabahar can be leveraged by India for the INSTC which will connect the Indian Ocean and the Persian Gulf with the Caspian Sea through Iran and then onwards to St. Petersburg in Russia and northern Europe. China on its part is pushing for its ambitious “One Belt One Road” initiative aimed at connecting around 60 countries across Asia, Africa and Europe.

“There has to be fast movement on the commitments made. This time there is push from the top. If we don’t sustain the momentum, the opportunity will not wait for us,” Roy added.

Indian projects in Iran have been facing inordinate delays. An Indian consortium comprising ONGC Videsh Ltd (OVL), Indian Oil Corp. Ltd (IOC) and Oil India Ltd (OIL) that won a bid for the Farsi block in 2002 from National Iranian Oil Co. (NIOC) is yet to secure the development rights.

Queries emailed to the spokespersons of Iranian embassy in New Delhi, IRCON and India’s ministries of shipping and external affairs on 11 August remained unanswered.

Interestingly, China’s ZPMC has won a contract to supply cranes to the Chabahar port, The Hindu Business Line reported on 11 August.

The Chabahar port, located in the Gulf of Oman near Iran’s border with Pakistan, is less than 100km from Pakistan’s Chinese-constructed port of Gwadar, part of a project to open up an energy and trade corridor from the Gulf to western China.